Airbnb

SF supervisors vote to legalize and regulate Airbnb’s short-term rentals

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The San Francisco Board of Supervisors today approved controversial legislation to legalize and regulate short-term housing rentals to tourists, voting 7-4 on the package after supervisors narrowly rejected a series of amendments to rein in an activity that has taken thousands of units off the market for local residents.

Amendments to limit hosted rentals to 90 nights per year, to require that Airbnb pay about $25 million in back transient occupancy taxes it owes the city before the legislation would go into effect, to exclude in-law units from eligibility for short-term rentals, and to limit rentals in single-family home neighborhoods failed on a series of 5-6 votes.

Sups. John Avalos, David Campos, Eric Mar, Norman Yee, and Jane Kim voted as a block on the amendments to limit the scope of short-term rentals facilitated by Airbnb and other companies, as a broad coalition that includes tenant, landlord, labor, neighborhood, and affordable housing groups had sought. Kim parted from that block to vote yes on the final legislation, which the others opposed.

Amendments proposed by Kim to give housing nonprofits the right to file injunctive lawsuits to help enforce the legislation and by Campos to ban short-term rentals in units that have been cleared of tenants by Ellis Act evictions were approved 8-3. But because those changes were substantial, they were turned into trailing legislation that must go back to the Planning Commission.

Despite a series of amendments since Board President David Chiu proposed the legislation over the summer, its basic tenets have changed little. It requires short-term rental hosts to register with the city and rent out only their primary residence, which they must live in for at least 275 days out of the year, with the Planning Department enforcing the regulation on a complaint basis.

That effectively limits the rental of entire homes to 90 days per year, but Chiu, Airbnb, and its hosts strenuously rejected calls to extend that cap to hosted rentals, such as spare bedrooms that might otherwise be available to permanent city residents. Chiu said his legislation was “framed through the lens of our housing affordability crisis,” arguing that many San Franciscans rely on Airbnb income to make their rent.

Avalos said he understands that position, but he said tourists shouldn’t be displacing San Franciscans, proposing the 90-day limit on all short-term rentals. “I think it’s important to maximize our residential housing stock to the utmost,” he said. Mar also voiced strong support for extended the cap, criticizing the “cult-like” beliefs by some home-sharing advocates.

As I’ve been reporting in the Guardian over the last two and a half years, Airbnb and its hosts have been openly defying city laws against short-term rentals, as well as ruling by the Tax Collector’s Office that the city’s transient occupancy tax (aka hotel tax) of about 15 percent applies to short-term rentals.

Airbnb just began to collect that tax for its guests last week, but Campos argued that it should pay those back taxes going back to the city ruling in the spring of 2012 before the city legalizes and validates its activities. Company representatives have said its TOT collection would total about $11 million per year.

“I believe it’s only right that Airbnb make good on its back taxes before this legislation becomes law,” Campos said, arguing this $10 billion company is being rewarded for defying city regulators. “Do we give special treatment to a multi-billion-dollar company?”

But supporters of the legislation were anxious to move it forward, despite the dizzying series of complicated amendments, something Avalos said was unusual. “I’m surprised it was given the green light to leave today,” Avalos told reporters after the vote. “There was a lot of pressure to move it forward.”

Now the question will be whether the Planning Department can effectively enforce the regulations, particularly given that Airbnb has been unwilling to share data that might help in that effort. City officials have seemed powerless to enforce laws against short-term rentals that have been on the books for decades, even with rising public concern about the issue over the last year.

“I’m concerned that the legislation simply isn’t enforceable,” Kim said, arguing for the private right of action component that will be returning for board consideration in the coming months.

The other question is whether we’ve heard the end of an issue that has polarized city residents, or whether the coalition of opponents will succeed in a threatened initiative campaign to put more stringent new short-term rental regulations before voters next year.

Sup. Mark Farrell thanked Chiu for taking on the issue despite the intractable positions on both sides, saying, “I think everyone recognizes this to be a no-win situation.” Wiener are referenced the wide emotional divide on the issue: “The views around it are so intensely divergent.”

“The status quo is not working. This system of home sharing is happening in the shadows with little or no oversight,” Wiener said. “It’s time to bring it out of the shadows.”  

Even supporters of the legislation, such as Breed, said they would continue closely monitoring the situation to ensure the legislation helps curbs widespread abuses of lucrative short-term rentals, including landlords evicting rent-controlled tenants to use Airbnb and entrepreneurial tenants renting out multiple apartments through Airbnb, practices Chiu sought to curb.

“The one thing that I think everyone can agree upon is the status quo is not working,” Chiu said early in the hearing.

After the legislation — which comes back to the board for a perfunctory final vote next week and goes into effect in February barring legal challenges — Airbnb’s Public Policy Director David Owen told the Guardian, “It’s a tremendous step forward and we have a lot of work to do.”

Opponents seek changes in Airbnb legislation before big hearing

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The broad and diverse coalition opposing Sup. David Chiu’s legislation to legalize and regulate Airbnb and other short-term housing rental companies — which the Board of Supervisors will consider tomorrow [Tues/7] — have boiled its many concerns down to three particular demands.

The coalition of tenant and landlord groups, affordable housing and neighborhood advocates, hotel workers and homeowners, and asundry other community leaders held another in a series of rallies on the steps of City Hall on Friday, again raising a variety of concerns.

But now, they’re penned a letter that has “three core recommedations.” The first is a call to limit rentals to 90 nights per year. That has been a feature of Chiu’s legislation from the beginning for unhosted rentals, given that it requires hosts to be permanent residents who live in their units at least 275 days per year, but the legislation still allows hosts to rent out a spare bedroom through Airbnb with few limits.

“If this is not done, the current proposal will allow year-round tourist rentals in every residential unit in the City which will drive up housing prices, create further economic incentive to increase evictions, further deplete housing stock for residents, and deteriorate the quality of life in our residential neighborhoods,” the coalition wrote in a letter to Chiu.

The supervisor had been a little cagey about the 90-day limit in the past, but when we pressed him on the issue during his endorsement interview with the Guardian last week, he confirmed that his legislation would allow spare bedrooms to be rented for more than 90 nights per year.

Chiu said his primary concern with the legislation was ensuring entire homes can’t be rented more than 90 nights per year, which he said was the main threat to the city’s rental housing stock, but he was open to amendments that would limit the rental of spare rooms, although that’s a practice he still wants to allow.

“We are grappling with the idea of what that balance is,” he told us.

The coalition is also asking for the legislation to explicitly ban short-term rentals of below-market-rate units and other affordable housing built with public subsidies. The third recommendation seeks to include “expedited private right of action” in the legislation, allowing neighbors and other third parties to file enforcement actions with the courts without waiting for city enforcement processes to slowly play out first.

That’s been a big problem recently as the San Francisco Tenants Union and other groups try to file lawsuits against landlords that have evicted rent-controlled tenants in favor of tourist rentals through Airbnb and other sites, but they’ve been prevented from doing so by foot-dragging in the Planning Department and Department of Building Inspection.

Members of this coalition will also present individual demands tomorrow, but the coalition also conveyed its opposition to supervisors approving this legislation tomorrow:

“We are unanimous in our position that the process being pursued by Supervisor Chiu is rushed. The City will live with the intended (and unintended) consequences of this legislation for many, many years. We implore you to amend the legislation with the recommendations articulated above, and as necessary postpone the Board hearing on this measure. This is one of the most important housing policy issues the City has faced in a decade, and the ‘solution’ by the Board of Supervisors must be done right and not hurried.”

The legislation will dominate the otherwise sparse agenda for tomorrow’s meeting, which starts at 2pm in City Hall. We’ll be live-tweeting the action, so follow along @sfbg or check back here for the full report. 

Airbnb says it will collect and pay local taxes in SF. Really.

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In the wake of this week’s contentious hearing on legislation to legalize and regulate short-term housing rentals in San Francisco, where Airbnb was chastised for snubbing the city on collecting and paying local taxes, the company today sent an email to its hosts announcing that it would begin doing so Oct. 1.

The message tells hosts that it will be collecting and remitting the city’s Transient Occupancy Tax on their behalf and that “hosts will not have to do anything extra.” But as Tax Collector Jose Cisneros told us for our article this week, that isn’t totally true. He said that hosts are still businesses and therefore need a business license, although companies like Airbnb can assume responsibility for the other two tasks involve: obtaining a “certificate of authority” that allows a business to collect taxes and filing monthly tax statements.

“All hosts would have to do is file annual business registrations,” Cisneros told us.

But hey, following local laws and correctly informing their customers about the legality of these transactions has never been Airbnb’s strong suit, so I suppose this is progress. The company’s email follows in its entirety:

 

Earlier this year, we announced that we would begin collecting occupancy taxes on behalf of hosts and guests in San Francisco. We’ve been working with the City to make the process streamlined and easy to follow, and today we are pleased to share that we are planning to launch this program on October 1. We know our community contributes substantial, positive economic impacts in neighborhoods across San Francisco, and this initiative will continue to make the city even stronger.

We’ve posted more information about this announcement on our Public Policy blog and we hope you’ll check it out. We also wanted to share more details about what this update specifically means for hosts and guests in San Francisco:

For reservations in San Francisco booked on or after October 1, guests will see a new line item on their Airbnb receipt for the city-imposed Transient Occupancy Tax. The tax will be added to the total amount paid by guests on stays of fewer than 30 days – hosts will not have to do anything extra. If you’ve already been collecting the San Francisco Transient Occupancy Tax for Airbnb guests, you should not do so after October 1.

Collection of these taxes won’t affect the payout amounts you receive as a host. Just like before, you’ll continue to receive your accommodation fee minus the Airbnb host service fee. Before paying and on the itemized receipt, your guests will see a separate amount for taxes in the total amount they pay for a reservation. If you’d like to learn more about occupancy taxes and Airbnb, please visit our Help Center.

Additionally, tomorrow our Regional Head of Public Policy David Owen will be hosting a webinar to discuss this important topic, and to give you the opportunity to ask questions. You can sign up to participate here.

San Francisco is our home and we look forward to continuing to work with everyone here to make it an even better place to live, work and visit.

Thanks,
The Airbnb Team

 

 

 

Still not sharing

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news@sfbg.com

As controversial legislation to legalize and regulate Airbnb and other short-term housing rental services operating in San Francisco headed for another contentious City Hall hearing on Sept. 15, the San Francisco Treasurer & Tax Collector’s Office quietly unveiled new policies and mechanisms for hosts to finally start paying long-overdue local taxes on their rentals.

Board of Supervisors President David Chiu’s legislation attempts to strike a balance between protecting housing for permanent city residents — including tenants in rent-controlled units who are being displaced in favor of visiting tourists — and allowing San Franciscans to sometimes rent out rooms through companies such as Airbnb. That practice has mushroomed during the Great Recession even though such short-term rentals of residential units have long been illegal in San Francisco (see “Into thin air,” 8/20/13).

Among other provisions, Chiu’s legislation would require hosts to register with the city and live in their units for at least 275 days per year (thus limiting rental nights to 90), create enforcement procedures for city agencies, and protect below-market-rate and single-room occupancy units from being used as short-term rentals.

But Airbnb has also been snubbing the city for more than two years since the Tax Collector’s Office held public hearings and concluded that short-term rental companies and their hosts are required to collect and pay the city’s Transient Occupancy Tax (aka, the hotel tax), a surcharge of about 15 percent on room rentals usually paid by visiting guests (see “Airbnb isn’t sharing,” 3/19/13).

After other media outlets finally joined the Bay Guardian in raising questions about the impact that Airbnb and other companies was having on San Francisco — and with cities New York City, Berlin, and other cities taking steps to ban short-term rentals — Airbnb announced in March that it would begin collecting and paying the TOT in San Francisco sometime this summer.

But that still hasn’t happened, even though Tax Collector Jose Cisneros recently unveiled a new website clarifying that Airbnb hosts must register as businesses and pay taxes and created a streamlined system for doing so. The office is even allowing Airbnb and other companies to register as “qualified website companies” that collect and pay these taxes on behalf of hosts.

“The law does apply to these transactions,” Cisneros told us. “And the set of requirements are the same for the hosts and the website companies.”

Airbnb didn’t respond to Guardian inquiries for this story.

Meanwhile, an unusually diverse coalition of critics continues to raise concerns about Airbnb and the regulatory legislation, including renter and landlord groups, neighborhood and affordable housing activists, labor leaders, and former members of the Board of Supervisors (including Chiu predecessor, Aaron Peskin) and Planning Commission. They penned a Sept. 15 to Chiu calling for him to delay the legislation.

“Individually and collectively, we have advanced nearly two dozen additional amendments that address the issues raised by short-term residential rentals. While we are not of one mind on every issue or every suggested amendment, we are unanimous in our belief that the process you are pursuing is rushed,” they wrote. “The City will live with the intended (and unintended) consequences of your legislation for many, many years.”

Sources in Chiu’s office had already told the Guardian that he planned to keep the legislation in committee for at least one more hearing so the myriad details can be worked out, as Chiu said at the hearing as well.

“We want to have the time to continue to vet and hear all of the perspectives, and at the end of the day what I hope to do is to be able to move forward and build incentives around something that is far better than our current status quo,” Chiu said at the hearing. “This is a very complicated issue, and we all know that we need to get this policy as right as we can.”

Planning Director John Rahaim conveyed concerns from the Planning Commission that the legislation beef up the city’s ability to regulate short-term rentals.

“The commission does believe that the law should be updated to create a legal avenue for those who do want to host,” Rahaim said. “However, currently there are about 5,000 units in the city engaging in short-term rentals. It’s very difficult to know if there are units not being lived in by a full-time resident.”

A long line of speakers wound completely around the packed chamber in City Hall, awaiting their turn to speak publicly to supervisors and city residents, from 20-somethings making a lives renting out their homes to longtime tenants fearing that home-sharing will hurt city’s character.

Airbnb was represented at the hearing by David Owen, a former City Hall staffer who is now director of public policy for the company, and he was publicly confronted by Chiu on the tax issue. Chiu criticized Airbnb for failing to start collecting those taxes as promised.

“As of now, we are extremely close and you will be hearing from us about that in the near future,” Owen said, provoking audible disbelief from many in the crowd. “We have been working diligently alongside the city. This is a complicated set of issues and those involved have all worked in earnest to facilitate this request.”

When Owen was asked about enforcement of the maximum number of nights a tenant has rented out his unit, he said Airbnb’s cooperation is “akin to the city asking Home Depot.com for a list of home care purchases to see if anyone had illegally renovated their bathroom.” But city officials say they need the company’s cooperation to address its impacts. “We don’t want data, just the number of nights per permanent resident so that we can ensure that the bad outcomes of this setup aren’t occurring,” Sup. Jane Kim said. “Airbnb profits from this industry, and therefore [is] accountable to the city.”

Get to work

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EDITORIAL The San Francisco Board of Supervisors returned to work this week after a month-long summer recess. While it may be too much to expect the supervisors to seriously tackle the many pressing issues facing this city during the fall election season, that’s exactly what needs to happen.

The city has been cruising along on auto-pilot, propelled by inertia more than any coherent political leadership, its elected leaders content to throw political platitudes and miniscule policy remedies at huge problems that are fundamentally changing the city.

While the eastside of the city is being rapidly transformed by rampant development, with no real plan for the displacement and gentrification that it’s causing, the westside still has suburban levels of density and no plan for shouldering its share of this city’s growth pressures. It’s good to see Sup. Katy Tang take a small step toward addressing the problem with her recently introduced Sunset District Blueprint, which seeks to build up to 1,000 new homes there over the next 10 years, that conceptual framework will require political will and more concrete goals to become reality.

To serve the density that westside residents are going to have to accept, the city and its Transportation Authority also must fast-track the Geary Bus Rapid Transit program that has languished for far too long. And the city’s “Complete Streets” and “Vision Zero” transportation reforms need to become more than just slogans, instead backed by the funding and commitment they need to become reality.

Similarly, there’s no reason why the Mayor’s Office, Planning Department, and pro-growth supervisors should be waiting for voters to act on Proposition K, the watered-down housing advisory measure, before they create a plan for implementing Mayor Ed Lee’s long-stated goal of building 30,000 new housing units, more than 30 percent of them affordable. That should have already happened before the promise was made.

This week, while the Board of Supervisors was slated to approve master lease agreements with the US Navy to develop Treasure Island, the city still isn’t seriously addressing concerns about radioactive contamination on the island or the project’s half-baked transportation plan.

Another important issue facing this compassionate city is how to provide legal representation for the waves of child refugees from Central America facing deportation in immigrations courts here in San Francisco. Board President David Chiu proposed a $100,000 allocation for such legal representation, which is a joke, and the board should instead approve the something closer to the $1.2 million commitment that Sup. David Campos has proposed.

We could go on and on (for example, when will Airbnb make good on its past-due promise to pay city hotel taxes?), but the point is: Get to work!

 

Airbnb must work with SF

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EDITORIAL

Airbnb and other companies that facilitate illegal short-term apartment rentals to tourists visiting San Francisco need to engage in a more honest and direct dialogue with this city’s political leaders and stakeholders, something that became clear during last week’s Planning Commission hearing on legislation that would legalize and regulate short-term sublets.

This is a complicated, vexing issue that defies simple solutions, as Board of Supervisors President David Chiu learned as he and his aides spent more than year developing the legislation. They did a pretty good job at striking a balance between letting people occasionally rent out their homes and preventing Airbnb from being used to remove apartments from the already strained local housing market.

A key provision for striking that balance was to limit rentals to no more than 90 nights per year, but the Planning Commission — dominated by appointees from Mayor Ed Lee, who has long coddled Airbnb’s scofflaw approach to the city (see “Into thin air,” 8/6/13) — removed that provision, which the Board of Supervisors should reinstate.

The commission also seemed to side with landlords who want to prevent their tenants from renting out rooms, calling for landlords to be notified when their tenants seek to become Airbnb hosts, another provision the board should reject. Landlords using Airbnb to get around rent control laws is at least as bad as tenants who violate their leases by subletting rooms, and this legislation shouldn’t favor one group over the other.

If the city decides to end its decades-old ban on short-term apartment rentals, it should have a compelling reason to do so. Maybe we want to allow struggling city residents to make some extra money while they’re out of town, or to have some flexibility in renting out rooms without taking on permanent tenants, which are legitimate if difficult policy questions.

But it seems like much of the discussion is about how to rein in the widespread violation of city housing and tax laws caused by Airbnb, which has refused requests to share more of its occupancy data, dodged its obligation to collect the city’s transient occupancy tax, and failed to even send a high-level representative to last week’s hearing. Yet the legislation would require the company’s cooperation to help enforce the regulations.

If Airbnb and its hosts want the city to legalize lucrative short-term rentals in San Francisco, then the company should be willing to engage in high-level public discussions with city leaders to shape this important legislation, rather than simply whipping its hosts into a libertarian frenzy with deceptive public relations campaigns.

Airbnb CEO Brian Chesky has gotten rich with a business model that is illegal in its home city, so the very least he can do is show up at City Hall next month to make a good faith effort to help solve the divisive problems that his company is creating.

 

Chinese youth rally for a brighter future

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High school students with Youth Movement of Justice Organizing (Youth MOJO), a teen leadership program affiliated with the Chinese Progressive Association, rallied at San Francisco City Hall Aug. 7 in a show of support for two citywide measures slated to appear on the November ballot.

The first would raise the city’s minimum wage to $15 an hour by 2018. The second, known as the anti-speculation tax, would impose a steep financial penalty on real estate investors who sell apartment buildings within five years of purchase, an effort to reverse the rising trend of Ellis Act evictions and limit skyrocketing rental prices.

High school student Alice Kuang, who has been active with Youth MOJO since last year, said she felt the effort to preserve affordability was critical for Chinese families who typically earn low wages. “I lived in an SRO in Chinatown for 13 years,” she explained, referring to a single-room occupancy hotel, a dormitory-style housing complex. Throughout the city, thousands of low-income tenants rely on SROs for affordable housing, but these units have been subjected to price increases and have started to become lost as affordable housing stock when they’re listed as short-term rentals on Airbnb.

“In the SRO, it was like one big community,” Kuang said. “Everyone supported each other. Like my mom knew exactly who was boiling water and then, to make sure the water didn’t spill over, she would run up to knock on people’s doors and be like, hey, your food’s done. It was a really strong community. I remember living there since I was born. It was a very small room. The four of us lived in it — we had a bunk bed, and another bunk bed, basically.”

Jessica Ng, a recent high school graduate and Youth MOJO member, said she was focused on advocating for the minimum wage proposal. “One of my parents became unemployed last year so it really took a toll on me, and made me realize that I have to also help,” she said, “like paying my part of the bill, or paying for groceries even.”

She said an internship with Young Asian Women Against Violence helped her earn some supplementary household income. “When I started getting a paycheck every three weeks or so, I started to pay my part of the bill,” she said. “With an increase in the minimum wage, it would really help with people who are my age who are going to college and want to help their families.”

 

Chiu’s proposed Airbnb regulations clear Planning Commission

Board President David Chiu’s proposed legislation regulating short-term rentals facilitated by tech companies Airbnb and VRBO won approval from the San Francisco Planning Commission on Aug. 7.

At the start of a public hearing, Chiu gave an overview, explaining that it would allow permanent residents – defined as San Franciscans dwelling in the city for at least nine months out of the year – to legally post their residences for short-term rent up to 90 days out of the year, legitimizing a practice that is technically prohibited under a city law prohibiting rentals of less than 30 days.

Under the proposed regulations, hosts would be required to register with the city, pay all associated taxes and sign up for liability insurance.

Anyone in violation, for example by posting a unit on Airbnb.com without registering, could be subjected to fines. While Chiu noted that he thought short-term rentals ought to be regulated to limit the threat Airbnb rentals pose to affordable housing in pricey San Francisco, he sought to strike a balance, saying, “Home sharing has allowed struggling residents to live in our expensive city.”

Public comment on the measure lasted for several hours. A host of speakers came out to share stories about how short-term rentals had helped them earn supplementary income and remain in San Francisco (as the Guardian previously reported, Airbnb sought to line up supporters via an online campaign effort called Fair to Share).

Yet opponents of the measure raised concerns that the new rule legitimizing short-term rentals via Airbnb could exacerbate San Francisco’s tremendous affordability crisis, by allowing residential spaces to be further commodified.

“There’s no hope we’re going to be able to control the adverse impacts of this legislation,” said Doug Engmann, a former planning commissioner. “This ill-conceived way of rezoning the city … causes all sorts of problems about how you’re going to be able to regulate this going forward.”

Ian Lewis, of hotel workers’ union Unite Here Local 2, warned of the impact on those employed by the city’s hotel industry.

“This legislation in one fell swoop is a green-light to legalizing short-term rentals,” said Lewis. “No one is more affected by this than hotel workers.”

Land use attorney Sue Hestor warned that Mayor Ed Lee’s proposal to construct 30,000 housing units “will be a farce … without a requirement that they really be rented or occupied as housing,” and suggested prohibiting the new units envisioned under this plan from being listed as short-term rentals on Airbnb.

Others raised concerns about the regulation’s lack of enforceability, and were critical of the provision allowing for 90 days of short-term rentals (many believed it was too permissive, but advocates who came out expressing support for Airbnb said it should be increased to 180 days).

The Board of Supervisors will take up the legislation in September after returning from August recess.

Guardian Intelligence: August 6 – 12, 2014

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GOOD VIBES

Jerry Day, when deadheads spanning generations congregate around the Bay Area to celebrate the legacy of SF native Jerry Garcia, should maybe start going by Jerry Week: Friday, Aug. 1 saw sold-out crowds at Berkeley’s Greek Theater and San Rafael’s Terrapin Crossroads for performances led by Warren Haynes and Stu Allen, respectively, while the official 12th annual Jerry Day celebration on Aug. 3 brought the masses to the city for Melvin Seals & the JGB and tons more at McLaren Park. Missed ’em? Don’t worry: Aug. 12 is Jerry Garcia Tribute Night at AT&T Park.

AIRBNB’S GAFFE-STROTURF?

Last week, Airbnb sent out an email blast proclaiming: “Big News: Launching Fair to Share San Fransisco!” [sic]. Misspellings happen, and hey, we all make mistakes. But what is Fair to Share? It’s “working for fair rules for home sharing,” according to the blast, linking to an online petition “urging the Board of Supervisors and San Francisco leaders to enact rules that let people share the home in which they live.” More to the point, this “coalition” seems focused on weakening enforcement provisions in legislation moving forward to regulate short-term rentals. So there you have it, SF’s newest grassroots movement — backed by a company valued at $10 billion.

SENIORS VERSUS SHUTTLES

Octogenarians unite! On the first day of the tech shuttle pilot program, last Friday a group of 25 or so seniors and people with disabilities blocked two Mission tech shuttles from making their morning tech sojourn to Silicon Valley. “Stop the senior evictions!” they shouted, alleging that 70 percent of no-fault evictions since 2011 were within four blocks of the shuttle stops, and two thirds of those evictions were of seniors. The 30-something tech workers looked ignored their elders, smartphones in hand, safely ensconced in their corporate buses.

REMEMBERING THE I-HOTEL

Nearly four decades ago, thousands of San Franciscans blockaded sheriffs from evicting seniors from the International Hotel, the last vestige of the Filipino community known as Manilatown. Eventually the sheriffs were successful, but the shameful displacement helped spur many San Francisco rental protections we enjoy today. Last week, the International Hotel Manilatown Center honored the anniversary of this dark mark on the city’s history. “We fought as long as we could,” Peter Yamamoto told us, who was 23 when he fought the evictions so long ago. “That night was like electricity.”

ON A HIGH NOTE

The San Francisco Opera kicks off its 92nd season Sept. 4 with a new production of Vincenzo Bellini’s Norma, starring soprano Sondra Radvonovsky, pictured, as the Druid priestess who falls in love a Roman soldier (spoiler: it doesn’t end well). The fall season — which also includes the work that started it all for SF Opera back in 1923, Puccini’s La Bohème, in November — continues Sept. 6 with the opening of Carlisle Floyd’s Susannah, with another stellar soprano, Patricia Pacette, playing the falsely accused Appalachian heroine. Opening weekend also includes the ever-popular “Opera in the Park” Sept. 7 in Sharon Meadow, for those who prefer their arias free and open-air. www.sfopera.com. PHOTO BY MARTY SOHL

WEINER TAKES ALL

Did you hear the pitter-patter of little feet over the weekend? If it wasn’t your child (or your pesky biological clock playing tricks on you), it was most likely the Wienerschnitzel Wiener Dog Race Nationals — the Bay Area regionals portion of which drew hundreds to the Santa Clara County Fair. They scampered! They leapt! The totally got distracted and lost interest in that cute little wiener dog way! Who put the most “dash” in “dachshund”? Why, Wally the Wiener of Gilroy, who took home $250 and a trip to San Diego for the national races.

HEY, SUGAR DADDY

We’re normally weirded out by pop culture-food trend tie-ins, but when Tout Sweet Patisserie (Macy’s Union Square, 170 O’Farrell St., 3rd Fl, www.toutsweetsf.com) chef Yigit Pura announced the launch of the “Hedwig Schmidt” macaron — in honor of beloved Tony-sweeper Hedwig and the Angy Inch — we totally bit. Bourbon-orange marmalade ganache with a brandied cherry center, covered in edible red glitter? Danke, mister!

IRON MAN: APP DEVELOPER?

Because San Francisco doesn’t have enough tech CEO megalomaniacs, Marvel Comics had to fictionalize one: Tony Stark, aka Iron Man, is headed to the city by the bay. Okay, not actually (sorry fellow geeks, Iron Man is fictional), but in the comic book world, the Manhattan-based metallic hero will develop apps by day, and rocket about in his new all white, iPod-esque armor by night. But why not an everyman superhero, like say, Spiderman? Remember, Peter Parker is a photographer: He’d probably move to Oakland.

 

Tenants target Airbnb rentals before hearings on regulatory legislation

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As the San Francisco Planning Commission prepares for an Aug. 7 hearing on Sup. David Chiu’s widely watched legislation to legalize and regulate short-term apartment rentals through Airbnb and similar companies, the San Francisco Tenants Union tomorrow [Tues/29] launches a “citizen enforcement” campaign against these currently illegal rentals.

Seeking to highlight the fact that “hundreds of tenants have been evicted and thousands of rent-controlled apartments in San Francisco have been illegally converted to hotel rooms in violation of two San Francisco laws,” SFTU announced it will begin posting signs on illegally converted buildings to warn tourists that the rentals are displacing city residents.

The campaign starts tomorrow at noon at 1937 Mason Street, a three-unit building where SFTU says all tenants were evicted under the Ellis Act so the units could be rented out through Airbnb and other online rental services. It’s the latest step in SFTU’s campaign to highlight illegal conversions, filing more than 50 complaints with the city and threatening further legal action. [UPDATE: A senior Airbnb official told the Guardian that no Airbnb hosts have rented out units at this address. Gullicksen said the units were rented out through VRBO.com, an Airbnb competitor].

“San Francisco is facing a severe housing crisis with soaring rents and evictions,” said SFTU Director Ted Gullicksen said in a press release. “It’s intolerable that the City is tolerating thousands of illegal conversions and thus facilitating hundreds of evictions.”

Apartment rentals of less than 30 days have long been illegal under city laws, including Administrative Code 41A, in order to protect the city’s rental stock for permanent residents. SFTU worked with Chiu’s office in crafting legislation that would legalize short-term rentals in residential areas but set a number of conditions, including a requirement for hosts to register with the city and limit rentals to no more than 90 days per year.

Airbnb is headquartered in San Francisco, but it has long defied city law and refused to collect required transient occupancy taxes on its rentals even after the city definitely ruled they were owed. The company pledged to finally start collecting the taxes sometime this summer and it has sought to make over its scofflaw public image with new branding and outreach efforts.

But with the company facing similar criticisms of its business model in New York City, Berlin, and other cities with strong housing demand, San Francisco’s regulatory effort is expected to be a high-stakes and high-profile struggle that will ultimately be decided by the Board of Supervisors, probably sometime this fall.

Meanwhile, some enterprising young disrupters have decided use Airbnb and state laws protecting tenants to start squatting in the properties of some of their hosts, creating big legal headaches for the owners and payoffs for the squatters. And just because we at the Bay Guardian were the first newspaper to suggest this idea, we seek neither blame nor credit. 

Guardian Intelligence: July 23 – 29, 2014

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J-POP ROCKED

The annual J-Pop Summit in Japantown drew a lively crowd of anime and other Japanese pop culture treasures to Japantown last weekend (including Shin, pictured). This year’s festivities included a Ramen Festival portion, featuring noodle cooks from around the world — and lines up to two hours long to sample their rich, brothy creations. PHOTO BY REBECCA BOWE

DA LOBBYIST

Former San Francisco Mayor and current Chronicle columnist Willie Brown, often just called Da Mayor, is widely acknowledged to be one of the most politically influential individuals in San Francisco. But until recently, he’d never registered as a lobbyist with city government. Now it’s official: Brown has been tapped as a for-real lobbyist representing Boston Properties, a high-powered real-estate investment firm that owns the Salesforce Tower. News outlets (including the Bay Guardian) have pointed out for years that despite having received payments for high-profile clients, Brown has never formally registered, leaving city officials and the public in the dark. Da Mayor, in turn, has seemed unfazed.

GAZA PROTEST

On July 20, marked as the deadliest day yet in the Israeli-Gaza conflict, hundreds of pro-Palestinian protesters gathered in San Francisco to march against the ongoing violence. Waving flags, participants chanted “Free, free Palestine!” and progressed from the Ferry Building to City Hall. It was just one of hundreds of protests staged worldwide in response to the bloodshed. As of July 21, the Palestinian death toll had risen to about 500, while 25 Israeli soldiers were killed. PHOTO BY STEPHANY JOY ASHLEY

PET CAUSE

Last year, the SF SPCA (www.sfspca.org) assisted with over 5,000 cat and dog adoptions. With its new adoption center near Bryant and 16th Streets, which opened June 13, it aims to increase capacity by 20 percent — saving 1,000 more furry lives in the process. The new facility features improved condo-style enclosures rather than cages, a small indoor dog park, and SF-themed climbing structures for cats. (So far, there’s a Golden Gate Bridge, a Transamerica Pyramid, a cable car, the Sutro Tower, and the SF Giants logo; a Castro Theatre design is in the works.) These improvements make the shelter life more comfortable for the animals, but they also help entice visitors, making the adoption process “a fun, happy experience,” says SF SPCA media relations associate Krista Maloney. See more kitties and puppies at the Pixel Vision blog at www.sfbg.com. PHOTO BY CHERY EDDY

MIX IT UP

The quarterly SF Mixtape Society event brings together people of all, er, mixes with one thing in common: a love of the personally curated playlist. This time around (Sun/27, 4pm-6pm, free. The MakeOut Room, 3225 24th St, SF. www.sfmixtapesociety.com) the theme is “Animal Instinct.” You can bring a mixtape in any format to participate — CD, USB, etc. (although anyone who brings an actual cassette will “nab a free beer and respect from peers.”) Awards will be given in the following categories: best overall mixtape, audience choice, and best packaging. Hit that rewind!

CODERS FOR KOCH

This week San Francisco plays host to the Libertarian conference/slumber-party Reboot 2014, aimed at — you guessed it — tech workers. Conservatives and government-decrying libertarians are natural allies, wrote Grover Norquist, scion of the anti-tax movement, in the pages of the Wall Street Journal. Uber swerves around transportation regulations, Airbnb slinks under housing regulations. It’s no wonder politically marginalized libertarians are frothing at the mouth to ally with Silicon Valley’s ascendant billionaires. Reboot 2014 speaker Rand Paul’s recent meeting with Mark Zuckerberg, Sean Parker, and Peter Thiel should have liberals all worried.

BART CLEANSING

BART announced via a press release they’d begin “ensuring safe evacuation” of downtown BART stations. By this they mean they’ll start sweeping out anyone sitting or laying down in the stations, clearly targeting the homeless. Deflecting those accusations, BART said they are one of the few transportation agencies with a dedicated outreach and crisis intervention coordinator, as if that gives them a pass.

CLIFF JUMPING

At 66, Jimmy Cliff put on one of the most energetic live shows we’ve ever seen on Saturday, July 19 at the Fillmore, high-kicking through newer songs, like “Afghanistan,” an updated version of eternal protest song “Vietnam,” as well as the classics: “The Harder They Come,” “Many Rivers to Cross,” etc. Check the Noise blog at www.sfbg.com for a full review.

 

Civil Grand Jury report highlights gifts made on mayor’s behalf

A major real-estate firm contributed $1 million to the America’s Cup Organizing Committee at the behest of Mayor Ed Lee, right around the time it sought city approval to expand a downtown tech office building that was already under construction.

Kilroy Realty, the developer of a 30-story building that will house more than 400,000 square feet of office space for Salesforce.com, won approval in August of 2013 to add an additional six floors to its 350 Mission commercial office space project. That building is one of three in the Transbay area that will house Salesforce.com offices.

Kilroy sent one check for $500,000 to the America’s Cup Organizing Committee on June 24, 2013, and a second one for the same amount on Jan. 31 of this year.

While it’s impossible to say for sure whether the generous gifts had anything to do with the request for approval for a major building expansion, the “behested payment” reports documenting the transactions did draw the attention of the San Francisco Civil Grand Jury, which included them in a report titled “Ethics in the City: Promise, Practice, or Pretense?”

In another example highlighted in the report, Mayor Lee accepted travel funds for a trip to China and Korea last October. Contributors who provided more than $500 apiece for that trip included Uber and Airbnb, both tech-based companies whose businesses stand to be directly impacted by city policies.

Uber has been sparring with the San Francisco International Airport over its drivers’ unauthorized passenger drop-offs as of late, while Airbnb long skirted its responsibility to pay the city’s hotel tax and is now the subject of legislation regulating short-term housing rentals. It’s interesting that each of these companies felt compelled to donate toward the mayor’s travel fund, given the city’s attempts to regulate them.

The Civil Grand Jury report highlights the shortcomings of the San Francisco Ethics Commission, an agency tasked with ensuring that government operations aren’t tainted by conflicts of interest or official misconduct.

Citizen watchdogs of San Francisco government have sought to eliminate pay-to-play politics for years.

Back in 2000, San Francisco voters approved a ballot measure seeking to bar elected officials from accepting campaign donations or gifts from corporations or individuals who had received city contracts or “special benefits.”

Known as Proposition J, that measure sought to eliminate the undue influence of deep-pocketed, well-connected players in local government.

It was popular and won by a landslide: No ballot arguments were registered against it, and the measure won with 82.66 percent of the vote.

Nevertheless, the Civil Grand Jury report noted, Prop. J was “amended out of existence” – through an effort led by none other than the Ethics Commission.

“The Ethics Commission proposed repealing Proposition J at their April 2003 meeting,” the report notes.

That proposal was part of an effort to “recodify conflict of interest laws,” the Civil Grand Jury found. Some laws were amended. Others were tweaked so that amendments could be made in the future, without voter approval.

After winning approval from the Board of Supervisors, that package of legislative changes became Proposition E on the 2003 ballot. “In 2003, voters approved Proposition E that recodified the ethics laws; however, it also had the undisclosed effect of deleting Proposition J language,” the Civil Grand Jury noted. “Thus, the concept of regulating public officials’ relations with those who receive ‘public benefits’ from them (Proposition J’s intent) was totally eliminated from San Francisco law.”

The report also takes the Ethics Commission to task for being too lax when it comes to addressing potential conflicts of interest.

It goes so far as to recommend that the agency hand over control of its major enforcement investigations to the Fair Political Practices Commission, a state agency with a more robust team of investigators who might produce better results.

“The Ethics Commission lacks resources to handle major enforcement cases,” the Civil Grand Jury notes. “These include, for example, cases alleging misconduct, conflict of interest, violating campaign finance and lobbying laws, and violating post-employment restrictions.”

The full report can be found here.

City agencies defend their slow response to Airbnb’s illegal rentals

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More information has been coming out about how Airbnb is used to convert San Francisco apartments into tourist rentals — including an interesting study reported by the San Francisco Chronicle last weekend — in advance of next month’s hearings on legislation to legalize and regulate short-term rentals.

But questions remain about why the city agencies in charge of regulating such “tourist conversions,” which have long been illegal under city law, have done so little to crack down on the growing practice. For more than two years, we at the Guardian have been publicly highlighting such violations, which have finally caught fire with the public in the last six months.

Even Mayor Ed Lee — who has helped shield Airbnb from scrutiny over its tax dodging and other violations, at least partially because they share an investor in venture capitalist Ron Conway — has finally said the city should pass legislation to regulate the company, as Sup. David Chiu is trying to do.

But attorney Joseph Tobener, who has represented clients evicted to facilitate Airbnb rentals and has brought a number of such lawsuits on behalf of San Francisco Tenants Union, still can’t get city departments to issue notices of violation even for the most egregious offenders that he’s suing, an administrative prerequisite to filing a lawsuit.

“The Department of Building Inspection and the Department of Planning need to start shutting these violators down by enforcing the existing laws, or we need stricter laws that allow us to pursue our claims without City approval.  Two months ago, we sent our requests to pursue landlords on behalf of the SFTU.  Then, radio silence.  Two months of utter inaction. Someone in charge does not want to see us close the loophole that is allowing landlords to take units out of our housing stock,” Tobener said.

The Chronicle investigation found that in San Francisco, 1,278 Airbnb hosts in San Francisco were managing multiple properties (Chiu’s legislation would limit hosts to their primary residence for just 90 rental nights per year), including 160 entire homes that tourists appear to be renting out full-time. Overall, the paper counted 4,798 properties for rent in San Francisco through Airbnb, 2,984 of which were entire homes, belying the “shared housing” label favored by the company and its supporters.

And even though groups like the San Francisco Apartment Association and SFTU say they have been actively trying to get the city departments to crack down on such illegal uses over the last year, representatives for DBI and the Planning Department say they’ve received few complaints and therefore issued few violations, while also saying they need more resources to regulate the problem, something Chiu’s legislation would begin to help address.

“Our enforcement process is complaint based and we investigate each complaint that is received by our Department (more than 700 per year).  Complaints regarding short term rentals that result in the loss of housing are prioritized for enforcement,” Planning Department spokesperson Gina Simi told the Guardian.

She said that property owners are given the opportunity to correct a violation before being cited, something that she said happens in about 80 percent of cases.

“A case is opened for every complaint received. Since March 2012, we have had approximately 120 enforcement cases for Short Term Rentals.  In each case, notices were sent to the property owner and approximately half (54) have been abated and half (66) are active cases.  Many of these (approximately 30) were received since the beginning of April 2014,” she told us when we inquired about the issue last month.

As for Tobener’s charge that city agencies are dragging their feet and making it difficult for his clients to pursue relief from the courts, she said, “The ability for interested parties to pursue the matter through civil action (for injunctive or monetary relief) following the filing of a complaint and determination of a violation is a process outlined in Chapter 41A, which is enforced by the Department of Building Inspection.  Enforcement under the Planning Code does not allow for interested parties to seek civil action.”

But DBI spokesperson William Strawn said his department hasn’t received many complaints, claiming to have gotten just three total through the end of last year.

“A few weeks ago, per Mr. Tobener, we did receive seven complaints, with documentation, that the Housing Division is still reviewing; and, per [DBI Chief Housing Director Rosemary] Bosque, we also recently received an additional seven complaints – for a current total of 14 – that also are under review and being scheduled for administrative review hearings, as required by Chapter 41A,” Strawn told the Guardian.

But he also pointed his finger back at the Planning Department as the agency that should be handling problems related to the short-term stays facilitated by Airbnb.

“Given that these ‘duration of stay’ issues are Planning Code matters – a point we have made to Supervisor Chiu, and which I know you discussed with the Planning Director {John Rahaim] during Supervisor Chiu’s media availability on this issue a few weeks ago – the role of the Building Department in the enforcement of these types of complaints in our relatively new Internet Age will require guidance from the City Attorney,” Strawn told us.

Indeed, in response to a Guardian question about why the Planning Department seems to have ignored violations facilitated by Airbnb, Rahaim said that his department hasn’t had the resources, tools, and authority to address the problem, even though, “This is an important issue we’ve been hearing about for quite some time.”

Chiu mailer highlights Guardian praise, despite our Campos endorsement

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Politics is dirty business, and I should never underestimate the willingness of politicians to turn any editorial praise they receive into an electoral advantage, distorting the context as needed, a lesson that I was reminded of this week.

Several Guardian readers have called me this week to complain about a mailer dropped on voters by the David Chiu for Assembly campaign, which includes long quotes from Chiu’s endorsements by the San Francisco Chronicle and Bay Area Reporter, as well as positive quotes from the Bay Guardian and San Francisco Examiner.

Although neither the Guardian nor the Examiner has endorsed Chiu — we enthusiastically endorsed David Campos in that race, while the Examiner is waiting until the fall rematch to do endorsements — our readers said the flyer left the impression that we had.

Chiu campaign spokesperson Nicole Derse disputes that view. “It definitely did not leave that impression,” she told me. “We were very clear about who has endorsed.” She said the Examiner and Guardian were included because “it’s important to highlight objective sources like newspapers.”

The Guardian quote was from a July 23, 2013 blog post in which I indeed wrote, “It is Chiu and his bustling office of top aides that have done most of the heavy legislation lifting this year, finding compromise solutions to some of the most vexing issues facing the city.”

It was certainly true at the time, although I received a lot criticism for what I wrote from the progressive community, which pointed out how Chiu had maneuvered himself into the swing vote position on key issues such as condo conversions and CEQA reform. And the compromises Chiu forged actually allowed fiscal conservatives to erode San Francisco’s standing as a progessive city while burgeoning his own political resume.

So I ran another blog post to air those concerns, and then we ran a hybrid of the two in the next week’s paper that closes with this line, “In the end, Chiu can be seen as an effective legislator, a centrist compromiser, or both. Perspective is everything in politics.” BTW, in that original post, I also noted that the Airbnb legislation Chiu was working on should challenge his political skills and reputation, and indeed it took many more months to introduce and has been met by a storm of criticism, becoming the marquee political fight of the summer at City Hall.

After that first post, I also heard from Campos and his supporters predicting that the Chiu campaign would use my well-meaning praise to convey support from the Guardian in a misleading way, a prophecy that has now proven prescient.

But I also think that Campos has done a good job at undermining Chiu’s greatest strength in this election, that of being an effective legislator, by hammering on the reality that things have gotten worse for the average San Francisco because Chiu and his allies have been most effective on behalf of the tech companies, landlords, and other rich and powerful interests that are undermining the city’s diversity, affordability, and progressive values.

“Effective for whom? That’s what’s important,” Campos told us during his endorsement interview, noting that, “Most people in San Francisco have been left behind and out of that prosperity.”

Chiu’s campaign counters by overtly and in whisper campaigns saying that progressives can’t be effective in Sacramento, blatantly overlooking the fact that the incumbent he’s running to replace, Tom Ammiano, has been both a consistent, trustworthy progressive, and an effective legislator who has gotten more bills signed than most of his colleagues, even as he takes on tough issues like reforms to Prop. 13 and prison conditions.

And Ammiano hasn’t just said good things about David Campos, his chosen successor — Ammiano has actually endorsed Campos.